SMSF - It’s all about control

Self Managed Superannuation, or SMSF for short, is now a fairly well known and topical subject at present. Superannuation is a long-term, tax-advantaged savings vehicle specifically designed to provide an income stream for your retirement.

For many Australians, their superannuation will grow to be one of their biggest assets, and therefore it is important to think about your superannuation’s performance, the fees you pay and the insurances you are able to cover yourself with.

Traditionally, assets invested within your industry or retail superannuation are controlled and directed by professional fund managers. Having an experienced investment fund manager to look after their superannuation suits many people, as they do not have the time to monitor the market, keep up with paper work or have te know-how to manage their own fund. However, it means members have limited control over their investment strategy or selection of assets.

Consequently, more and more people are realising the advantages of making their own investment decisions and taking control of their retirement strategy. Companies such as Future Assist SMSF are tailoring their internal structures to suit busy Australian who desire the ‘control and investment flexibility’ but may lack the time or resources which are traditionally associated with an SMSF.

What is an SMSF?

* A personal or family super fund with no more than 4 members;

* Each individual trustee of the fund is a fund member;

* Each member of the fund is a trustee;

* No member of the fund is an employee of another member of the fund, unless those members are related;

* No trustee of the fund receives remuneration for his or her services as a trustee; and

* The SMSF must have a written Trust Deed and Investment Strategy that meets all members’ objectives.

The primary motivation for members in setting up an SMSF is generally the desire for investment control. The requirement that all members must be trustees of the fund means the control of the fund is shared between the members of the fund.


Members of an SMSF can tailor their own investment strategies and select specific investments such as: 


·     * Listed securities


·     *  Managed investments


·     * Cash, securities and term deposits 


·     * Both direct and listed property


·     * Business real property
international equities


·     * Collectables and exotic assets

·     *  Life insurance policies


·      * Agribusiness


·     *  Instalment warrants

 


For many people, the complexity of the superannuation rules has been a deterrent to getting more involved in their super. After all, can I really manage my money better than a professional..?

In an effort to make super easier to understand, “Simpler Super” rules were introduced from 1 July 2007 and dramatically changed the superannuation landscape.

It’s simply super

The fundamental principle of the “Simpler Super” changes was to provide greater incentive for people of all ages to adequately plan for their future. The governments policy objective is to assist and encourage people to achieve a higher standard of living in retirement than would be possible from the age pension alone.

 

Is it right for you?

There is no doubt control, involvement and tax effectiveness are very good reasons for establishing your own SMSF. However, you should also consider other factors when deciding if an SMSF is the most appropriate vehicle for you. The ATO and ASIC have prepared a fact sheet to help prospective trustees make the right decision (available from www.ato.gov.au/ super).

When consulting with Future Assist SMSF, your adviser will take into consider a multitude of factors which will come into play with self-managing your super, Like:

·     * What are my retirement goals?

·     * How long do I have left in the workforce?

·     * How much is my employer contributing into my super? (x how many years left in the workforce).

·     * Would I personally be an able trustee?

·     * What investment classes am I comfortable with?

·      * What fees am I currently paying? Will this increase or decrease with an SMSF?

… and many more.

It’s Future Assist SMSFs goal that above all, you value your superannuation and establish a professionally-advised plan to see you reach your retirement goals.

For any assistance you require in setting up an SMSF or to see if an SMSF would suit you, contact Future Assist today. Click here to Speak to an Adviser about SMSF today or phone us: 1300 118 618

 

The above is given as general advice and is not specific to your circumstances or taking into account factors that may affect you. Thinking of acting on setting up an SMSF? speak to a licensed professional before making any decisions.